France blocks Mercedes compact registrations in coolant dispute

Dorothee Tschampa Bloomberg News

Posted:
07/26/2013 06:01:53 PM MDT

Updated:
07/26/2013 06:01:53 PM MDT

Daimler AG, the world's third- biggest maker of luxury vehicles, is barred from registering its Mercedes-Benz compact models in France because regulators have stopped accepting a coolant fluid used in the vehicles.

The Mercedes A- and B-Class as well as the CLA coupe can't be registered in the country as they use a refrigerant that no longer meets to European Union environmental regulations, the Ministry of Ecology, Development and Energy said in a statement Friday. Daimler said that it plans legal action against the move, which it called a misreading of EU law.

Daimler has been in talks for about a year with European authorities over a newer refrigerant, R1234yf, that regulators say meets stricter standards on greenhouse gas emissions. The Stuttgart, Germany-based manufacturer has held off from switching to R1234yf, saying the new fluid is susceptible to catching fire in car crashes.

Daimler sold 15,745 compact vehicles in France in the first six months of 2013, accounting for about 2 percent of its global car deliveries in the period, Ulrike Bless, a spokeswoman, said by phone.

The carmaker was in "discussions with all the relevant institutions in order to reach rapid clarification of the situation," Daimler said in its second-quarter report published July 24.

French regulators are incorrectly basing their decision on a provision of EU regulations that allows vehicles to be banned in the event of a "major" immediate risk to people's health or the environment, "which is absolutely invalid in this current case," Daimler said in an e-mail today.